Consolidated Annual Accounts 2017

Atresmedia Corporación de Medios de Comunicación, S.A. 2017 FINANCIAL STATEMENTS 48 “Inventories” includes expenses incurred in programmes production. The Company’s policy is to capitalise and subsequently amortise this expenditure as described in Note 4.7. Of total procurements in 2017, EUR 40 million related to purchases in other European Union countries (2016: EUR 31 million) and approximately EUR 66 million to purchases in non-EU countries (2016: EUR 69 million), mainly the United Statements. 18.3 Employee benefits expense Employee benefits expenses in 2017 and 2016: Thousands of euros 2017 2016 Social Security payable by the Company 5,500 5,136 Other employee benefits expense 1,355 1,387 Total 6,855 6,523 18.4 Other operating expenses Breakdown of other operating expenses in 2017 and 2016: Thousands of euros 2017 2016 Subcontracted work 57,235 57,699 Communications 43,213 41,450 Leases and royalties 27,786 27,484 Advertising and publicity 8,478 9,069 Copyrights and other expenses 81,654 78,610 Total 218,366 214,312 The most significant item under “Leases and royalties” is the television operators’ contribution to the financing of Corporación RTVE. “Copyrights and other expenses” includes changes in the allowance for doubtful receivables. In 2017, the Company recognised a charge of EUR 103 thousand and used EUR 340 thousand (EUR 643 thousand and EUR 453 thousand, respectively). 18.5 Finance income and costs Finance income and finance costs calculated by applying the effective interest method (in thousands of euros): 2017 2016 Finance income 51,528 36,739 Finance costs 7,365 6,205